Standard & Poor's Rating Services lowered its ratings on Hawaiian Telcom, saying it believes the company's "liquidity will be insufficient to service debt and fund operations through 2009."

S&P downgrade includes a cut in Hawaiian Telcom's corporate credit rating to "CCC+" from "B-."

Lower credit ratings generally increase a company's borrowing costs.

S&P's assessment reflects "the challenging business environment, the company's weak operating results, and its excessive leverage," Hawaiian Telcom analyst Susan Madison said in a news release.

Hawaiian Telcom has about $1.1 billion in outstanding debt as of June 30, S&P said.